Today’s mortgage and refinance rates 

Average mortgage rates rose again yesterday. Don’t believe all the headlines about falling mortgage rates. They’re based on Freddie Mac’s survey and its methodology means it missed most of this week’s rises.

But there may be a little relief at hand. Judging from early trading in key markets, mortgage rates today may fall a little or perhaps hold steady.

Find and lock a low rate (May 24th, 2021)

Current mortgage and refinance rates 

Find and lock a low rate (May 24th, 2021)

COVID-19 mortgage updates: Mortgage lenders are changing rates and rules due to COVID-19. To see the latest on how coronavirus could impact your home loan, click here.

Should you lock a mortgage rate today?

So far, this week has been a bad one for mortgage rates with four consecutive rises. But last week was a good one. And it’s much too soon to identify a trend.

Yes, next week could be a good one again. But it’s equally likely to be bad or neutral. And, to me, the dangers of a higher rate outweigh the possibility of gains through a lower one. But only you can make that call, based on your personal tolerance for risk.

So my personal rate lock recommendations remain:

• LOCK if closing in 7 days
• LOCK if closing in 15 days
• LOCK if closing in 30 days
• LOCK if closing in 45 days
• LOCK if closing in 60 days

But I don’t claim perfect foresight. And your personal analysis could turn out to be as good as mine — or better. So you might choose to be guided by your instincts and your personal tolerance for risk.

Market data affecting today’s mortgage rates 

Here’s a snapshot of the state of play this morning at about 9:50 a.m. (ET). The data, compared with roughly the same time yesterday, were:

• The yield on 10-year Treasurys fell to 1.63% from 1.68% (Good for mortgage rates.) More than any other market, mortgage rates normally tend to follow these particular Treasury bond yields, though less so recently
• Major stock indexes were higher on opening. (Bad for mortgage rates.) When investors are buying shares they’re often selling bonds, which pushes prices of those down and increases yields and mortgage rates. The opposite happens when indexes are lower
• Oil prices edged higher to $64.81 from $64.52 a barrel. (Neutral for mortgage rates*.) Energy prices play a large role in creating inflation and also point to future economic activity. 
• Gold prices increased to $1,841 from $1,820 an ounce. (Good for mortgage rates*.) In general, it’s better for rates when gold rises, and worse when gold falls. Gold tends to rise when investors worry about the economy. And worried investors tend to push rates lower
• CNN Business Fear & Greed index — Inched higher to 38 from 37 out of 100. (Bad for mortgage rates.) “Greedy” investors push bond prices down (and interest rates up) as they leave the bond market and move into stocks, while “fearful” investors do the opposite. So lower readings are better than higher ones

Caveats about markets and rates

Before the pandemic and the Federal Reserve’s interventions in the mortgage market, you could look at the above figures and make a pretty good guess about what would happen to mortgage rates that day. But that’s no longer the case. We still make daily calls. And are usually right. But our record for accuracy won’t achieve its former high levels until things settle down.

So use markets only as a rough guide. Because they have to be exceptionally strong or weak to rely on them. But, with that caveat, so far mortgage rates today look likely to move modestly lower. And be aware that intraday swings (when rates change direction during the day) are a common feature right now.

Find and lock a low rate (May 24th, 2021)

Important notes on today’s mortgage rates

Here are some things you need to know:

1. Typically, mortgage rates go up when the economy’s doing well and down when it’s in trouble. But there are exceptions. Read ‘How mortgage rates are determined and why you should care
2. Only “top-tier” borrowers (with stellar credit scores, big down payments and very healthy finances) get the ultralow mortgage rates you’ll see advertised
3. Lenders vary. Yours may or may not follow the crowd when it comes to daily rate movements — though they all usually follow the wider trend over time
4. When daily rate changes are small, some lenders will adjust closing costs and leave their rate cards the same
5. Refinance rates are typically close to those for purchases. But some types of refinances are higher following a regulatory change

So there’s a lot going on here. And nobody can claim to know with certainty what’s going to happen to mortgage rates in coming hours, days, weeks, or months.

Are mortgage and refinance rates rising or falling?

Today and soon

There’s much less about inflation in today’s financial reporting. But, yesterday, The New York Times’s Neil Irwin summed up the hope and the fear:

Higher prices and the other problems that result from an economy that reboots itself are frustrating, but should be temporary. Still, the longer that the surges in prices continue and the more parts of the economy that they encompass, the greater the chances that Americans’ psychology about prices and inflation could shift in ways that become self-sustaining.

— NYT, “Inflation Is Here. What Now?,” April 13, 2021

In other words, fear of inflation may or may not be justified. But there’s a risk we’ll make it self-fulfilling either way.

The problem is, fear of inflation pretty much inevitably brings higher mortgage rates, as do economic booms. And it sounds as if we might be stuck with both of those for the rest of this year — and perhaps beyond.

Of course, each of those will wax and wane in prominence as investors’ focus moves. But they are likely to remain in play for months to come. And that’s the main reason I remain fairly confident that — absent catastrophic news — those rates are going to move higher for some time to come.

For more background, check out our latest weekend edition of this report.

Recently

Over much of 2020, the overall trend for mortgage rates was clearly downward. And a new, weekly all-time low was set on 16 occasions last year, according to Freddie Mac.

The most recent weekly record low occurred on Jan. 7, when it stood at 2.65% for 30-year fixed-rate mortgages. But then the trend reversed and rates rose.

However, those rises were mostly replaced by falls in April, though those have moderated since the middle of that month. Freddie’s May 13 report puts that weekly average at 2.94% (with 0.7 fees and points), down from the previous week’s 2.96%. But note that Freddie uses samples from Mondays and Tuesdays. So it will have largely missed the major rises later that week.

Expert mortgage rate forecasts

Looking further ahead, Fannie Mae, Freddie Mac and the Mortgage Bankers Association (MBA) each has a team of economists dedicated to monitoring and forecasting what will happen to the economy, the housing sector and mortgage rates.

And here are their current rates forecasts for the remaining quarters of 2021 (Q2/21, Q3/21, Q4/21) and the first quarter of 2022 (Q1/22).

The numbers in the table below are for 30-year, fixed-rate mortgages. Freddie’s were updated on April 14, Fannie’s on April 12 and the MBA’s on April 22.

Forecaster	Q2/21	Q3/21	Q4/21	Q1/22
Fannie Mae	3.2%	3.3%	3.4%	3.5%
Freddie Mac	3.2%	3.3%	3.4%	3.5%
MBA	3.4%	3.6%	3.7%	3.9%

However, given so many unknowables, the current crop of forecasts might be even more speculative than usual. But, if any of those forecasts are to be proved right, rates will at some point have to rise quickly during the remaining seven weeks of the current quarter (Q2).

Find your lowest rate today

Some lenders have been spooked by the pandemic. And they’re restricting their offerings to just the most vanilla-flavored mortgages and refinances.

But others remain brave. And you can still probably find the cash-out refinance, investment mortgage or jumbo loan you want. You just have to shop around more widely.

But, of course, you should be comparison shopping widely, no matter what sort of mortgage you want. As federal regulator the Consumer Financial Protection Bureau says:

Shopping around for your mortgage has the potential to lead to real savings. It may not sound like much, but saving even a quarter of a point in interest on your mortgage saves you thousands of dollars over the life of your loan.

Verify your new rate (May 24th, 2021)

Mortgage rate methodology